By Michael Aneiro

Puerto Rico late Friday said its April revenues fell 27% short of expectations, blaming it on a substantial shortfall in corporate tax revenues. Puerto Rico reported $1.18 billion of April revenues, short of the $1.62 billion forecast, even as it beat April 2013′s earnings by 20% and said it collected more tax than it did last April. Puerto Rico said its year-to-date general fund revenues for fiscal 2014 have totaled $7,261 million, up 6.8%, from the previous year.

“While April 2014 revenues exceeded the prior year period, the amount collected was $442 million below estimates, with $380 million of that amount corresponding to the corporate income taxes line revenue,” said Puerto Rico Treasury Secretary Melba Acosta Febo in a statement, citing the tax returns not filed by the April 15 due date. “We are analyzing the thousands of applications for time extensions that were not accompanied by payments (53% of all corporations), corporations that did not make estimated payments, and payments by corporations that were below expectations. The time extension for corporations is three months in duration and ends July 15, 2014.”

Acosta Febo said corporate taxpayers that filed applications for time extensions without a payment or with an insufficient payment could be subject to a surcharge of up to 10%, plus interest at a 10% annual rate. He added that the Treasury Department “will continue working on a fair tax reform that simplifies tax processes and promotes economic development, and will continue strengthening oversight efforts to increase the capture rate and fight against tax evasion to attain the financial goals we have set.”

Puerto Rico’s $3.5 billion of 21-year bonds issued in March, the handiest bond-market proxy for the commonwealth’s financial situation, have traded anywhere between 89.5 and 91.75 cents on the dollar in modest trade volume so far Monday, down from a range of 92 to 94.75 cents on Friday. The bonds were originally issued at a discounted face value of 93 cents on the dollar.

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There are 3 comments

MAY 12, 2014 12:34 P.M.

bud u. wrote:

Is PR the new Venezuela?

MAY 13, 2014 7:59 A.M.

islander wrote:

PRGOV simply is spending more money that it is earning and is trying to balance the budget by increasing taxes instead of cutting expenditures. Gov Garcia prefers to increase taxes during an almost 8 year recession than to implement politically sensitive cuts. He also is ignoring the 2012 vote in favor of statehood.

MAY 13, 2014 8:01 A.M.

Islander wrote:

Bondholders be careful, the current PR administration will prefer to win an election than to safeguard paying the bond debt, they are talking about re restructuring the debt.